FREE INVENTORY CALCULATOR

Reorder Point Calculator

Know when to reorder based on demand, lead time, and safety stock.

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Built for real inventory decisions

Calculator

Results

Calculated

Reorder Point (ROP)750 units

Place a new order when inventory position reaches 750 units.

Lead Time Demand700 unitsDemand during lead time

Safety Stock50 unitsDemand/supply buffer

Current Inventory Position1,000 unitsOn-hand + on-order − backorders

Average Daily Demand100 units/dayYour input value

Decision metrics

Days Until Reorder2.5 daysPlanning signal, not a forecast

Estimated Stockout10 daysAssumes no replenishment arrives

Inventory StatusMonitorBased on inventory position

Value at Reorder Point$15,000ROP × unit cost

Decision Insight

At the current demand rate, your inventory position is expected to reach the reorder point in about 2.5 days.

Key Takeaways

Reorder point combines lead-time demand and safety stock.
Use inventory position, not only on-hand stock, when deciding when to reorder.
Recalculate when demand or supplier lead time changes.
Safety stock should reflect demand and supply uncertainty.

How It Works

The reorder point (ROP) is the inventory level at which you should place a new order to avoid stockouts.

It’s based on the expected demand during lead time plus a safety stock buffer.

When your inventory position (on-hand stock + on-order stock − backorders) reaches the ROP, it’s time to place a new order.

Formula

ROP = (Average Daily Demand × Lead Time) + Safety Stock

Where:

Average Daily Demand: expected number of units sold or used per day.
Lead Time: time from placing an order to receiving it, measured in days.
Safety Stock: extra stock to protect against demand or supply variation (optional).

Example Calculation

Let’s say:

Average Daily Demand: 100 units/day
Lead Time: 7 days
Safety Stock: 50 units

ROP = (100 × 7) + 50 = 700 + 50 = 750 units

You should place a new order when your inventory position reaches 750 units.

How to Use the Result

Monitor inventory position, not only on-hand inventory.
When inventory position reaches the reorder point, place or release the next order.
Use Days Until Reorder as a planning signal, not a guaranteed forecast.
Recalculate when demand, lead time, or safety stock assumptions change.

Limitations

The basic reorder point formula assumes average demand is reasonably stable.
Highly seasonal or promotional demand may require forecasted demand instead of a simple historical average.
Variable supplier lead times may require a more advanced safety stock calculation.
Unexpected supply disruptions can make a simple reorder point less reliable.
This calculator does not replace a full inventory forecasting or planning system.
Days Until Reorder and Estimated Stockout assume demand continues at the entered average rate and do not model seasonality, open purchase orders beyond inventory position, or sudden supply disruptions.

Frequently Asked Questions

What is a good safety stock level?

A useful safety stock level depends on demand variability, supplier reliability, and the service level you need. Start with a representative demand and lead-time history, then review the buffer against your stockout risk and carrying cost.

What if my demand is seasonal?

Use a demand rate that reflects the period covered by the supplier lead time. For seasonal products, recalculate the reorder point as demand changes instead of relying on one annual average.

Should I use average or forecasted demand?

Use the best estimate of expected demand during the upcoming lead time. A forecast can be more useful than a historical average when you have a reliable forecast and demand is trending or seasonal.

How does lead time variability affect the reorder point?

Longer or less predictable lead times increase the chance that demand will exceed available stock before replenishment arrives. Account for that uncertainty in safety stock and keep lead-time units consistent with the demand rate.